Rugged mobility specialist Tough Corp will be forced to pay back $5 million to Westpac after the bank appointed a receiver to reclaim the debt.
CRN revealed yesterday the reseller had gone into voluntary administration and shut down its Sydney headquarters and global offices.
ASIC documents sighted by CRN reveal the company owes 77 unsecured creditors over $561,000, with these creditors at the time of writing having submitted claims for around $270,000.
PKF Australia has been appointed receiver on behalf of Westpac, and today confirmed to CRN it was working to reclaim the $5m secured loan granted to the reseller earlier this year.
Tough Corp director Tony Troth was forced to sell his house in West Ryde, Sydney to repay $1.2 million of the debt. Troth put his property up as security when Westpac first granted the Tough Corp loan.
Troth resigned his position towards the end of May, while co-founder Francis Bryant is still listed as a director of the company.
Attempts by CRN to contact Troth and Bryant elicited no response by the time of publication.
Westpac and PKF Australia expect to reclaim the remainder of the lost funds in the next two months.
As unsecured creditors, Tough Corp’s 20-odd employees are not entitled to reclaim lost wages through Tough Corp.
A spokesperson for liquidator Lawler Partners said employees would be compensated under the Federal Government’s GEERS (general employee entitlements and redundancy scheme) program.
The GEERS fund does not account for lost superannuation. Employees are expected to be compensated for wage loss by GEERS in the next few months.
Sources told CRN employees received their last paycheck on April 15 and were not notified of the company's impending collapse.
In documents filed to ASIC, Tough Corp's Bryant blamed the company's decline on falling sales, high staffing overheads and court costs associated with legal cases brought against the company.
A failed attempt to sell the business to UK electronics supplier Steatite was also cited as contributing to the company's demise.
Phone lines to Tough Corp’s five global offices have been disconnected and attempts to contact the distributor via email have not been answered.
The mobility solutions provider had offices in the US, UK, Europe and Asia, including its Sydney headquarters.
Its creditors include the likes of Telstra, the ATO, Energy Australia, the Department of Fair Trading, LaCie Australia, Synnex and rugged mobility vendor Getac.